Egypt's Foreign Reserves Jumps $26.2 Bn in 3 Yrs

Egypt's foreign reserves have risen by about $ 26.2 billion since the exchange rate liberalization until the end of October 2019.

Three years after the decision to liberalize the Egyptian pound, increasing Egypt's foreign exchange reserves is one of the most positive results of the economic reform program.

During the 2011 January Revolution, foreign reserves suffered from a sharp downturn that peaked in March 2013, recording about $ 13.6 billion.

It is noteworthy that the foreign reserves of Egypt recorded about $ 36 billion before the revolution, before being depleted in the years after the revolution; due to the decline of dollar sources, especially foreign direct investment (FDI) and tourism.

On November 3, 2016, the Central Bank of Egypt (CBE) decided to liberalize the exchange rate of the pound against foreign currencies.

After the decision, Egypt's foreign reserves were able to regain strength, especially after obtaining the first tranche of the IMF loan, which amounted to $12 billion over three years.

At the end of November 2016, Egypt's foreign reserves stood at $ 23.05 billion, compared to $ 19.04 billion a month earlier.

Egypt's foreign reserves went through leaps in 2018 following the issuance of international bonds, exceeding $ 42 billion at the end of February 2018, and then exceeding $ 44 billion at the end of April the same year after the issuance of euro-denominated bonds.

In February 2018, Egypt succeeded in issuing international bonds worth $ 4 billion and in April, the country launched two billion euro bonds.

Egypt's foreign reserves have continued to jump over the past three years to exceed $ 45 billion last October at $ 45.2 billion.

Tourism is one of the factors that have supported Egypt's foreign reserves during the last period, after tourism revenues rose near 2010 levels.

According to data of the CBE, revenues of Egyptian tourism during the last fiscal year amounted to about $ 12.57 billion, compared to $ 9.80 billion during the previous FY 2017-18.

The IMF raised Egypt's tourism revenue forecast for FY 2019-20 to $ 16.7 billion from $ 14.2 billion in its previous forecast.

Tourism revenues in Egypt are expected to continue to rise over the next five years to $ 24.1 billion in 2023-24, up nearly 100 percent from last year's fiscal revenues, the IMF said in its fifth review.

Also, Egypt's foreign reserves are expected to continue to rise in the coming period, supported by Egypt's plan to expand international bonds activities.

The Egyptian Ministry of Finance plans to launch a new international bond in dollar currency in the international financial markets in the coming period.

Earlier, Egypt's Finance Minister Mohamed Maait said his country was targeting international bonds worth $ 3-7 billion in the current FY 2019-20.